Iran Records 25% Growth in Steel Exports
EghtesadOnline: Major Iranian steelmakers exported a total of 437,090 tons of steel in the first Iranian month (March 21-April 20) to register a year-on-year increase of 25%, latest data released by the Iranian Mines and Mining Industries Development and Renovation Organization show.
With a total of more than 258,461 tons of exports over the month, Khouzestan Steel Company was Iran's biggest exporter of steel, as its exports rose by 96% compared with last year’s similar month.
The steelmaker, located in southwestern Khuzestan Province, exports to over a dozen countries. About half of KSC's exports goes to the Middle East and North Africa region. Its other major export destinations are located in the Far East and Americas.
Hormozgan Steel Company followed with 62,652 tons, registering a 40% increase year-on-year. It was followed by Mobarakeh Steel Company with 56,102 tons, up 45% YOY; Esfahan Steel Company with 32,324 tons, down 42% YOY, South Kaveh Steel Company with 25,000 tons, up 25% YOY; and Iran Alloy Steel Company with 1,351 tons, down 67% YOY, according to Financial Tribune.
Steel exports grew, despite the steady flow of production during the period under review.
According to IMIDRO, 1.75 million tons of slab, bloom, billet and ingot were produced during the one-month period, up 1% YOY.
Mobarakeh Steel Company, with its subsidiaries Saba and Hormozgan Steel, was the biggest producer with 826,540 tons, down 4% YOY. KSC came next with 325,902 tons, down 5% YOY, and it was followed by ESCO with 202,330 tons, down 4% YOY, South Kaveh Steel Company with 101,029 tons, up 10% YOY, Khorasan Steel Company with 97,933 tons, up 7% YOY, Chadormalu Steel Company with 87,626 tons, up 31% YOY, Arfa Iron and Steel Company with 77,000 tons, up 31% YOY, and Iran Alloy Steel Company with 39,558 tons, up 63% YOY.
No data were published on the export of finished steel products.
According to Deputy Minister of Industries, Mining and Trade, Jafar Sarqeini, currently, Iran’s steel production capacity stands at 34 million tons per year.
Iranian steel mills produced a total of 25 million tons of crude steel in 2018, up 17.7% compared with 2017, Worldsteel reported.
Iran was ranked the world’s 10th biggest producer of steel in 2018. The country is placed between Brazil (ninth) with 34.73 million tons and Italy (11th) with 24.47 million tons.
Iran's steel exports, among other commodities, have come under pressure due to US sanctions.
UK-based analysts in Fastmarkets say the US sanctions are expected to cut Iranian steel exports and gradually lower Iranian steel output.
US President Donald Trump announced his decision to pull out of the nuclear deal Iran signed with world powers, including the United States, back in May.
He specifically ordered new sanctions targeting Iran's export revenues from its industrial metals sector earlier this month.
An executive order issued by Trump covers Iran’s iron, steel, aluminum and copper sectors, the Islamic Republic’s largest non-petroleum-related sources of export revenue and 10% of its export economy, a statement from the White House said.
However, Sarqeini dismissed concerns about the latest US sanctions, saying high-quality Iranian products have their own international customers.
"It is unlikely that the sanctions imposed by US President Donald Trump will significantly affect Iran’s metals industry," he was quoted as saying by Tasnim News Agency, adding that he saw no reason for concern due to the excellent quality of Iranian metals that meet international standards.
“Sanctions against Iran’s economy are actually not new; they just get tougher by the round,” said a senior member of Iranian Iron Ore Producers and Exporters Association, Qadir Qiafeh.
“Businesspeople have learned to create workaround to US trade sanctions. Although some of these methods have been identified and can’t be used again, Iran’s mineral products will remain available on global markets,” he stressed.
Qiafeh believes the executive order issued by Trump on May 8, 2019, to impose new sanctions on Iran’s industrial metals is more of a symbolic gesture than anything else since the US had already announced on the same date a year ago that Iran’s steel, copper and aluminum industries were included in the first wave of sanctions.
A large part of mineral and steel exports is sold to neighboring countries by small- and medium-sized enterprises to their counterparts in export destinations. These SMEs usually slip under the US radar.
In the meantime, shipping problems are said to be a major issue in the way of steel exports.
At present, Iranian steel exporters have had to cut prices significantly to attract customers and compensate for the risks involved in trade with the country.
According to Deputy Minister of Industries, Mining and Trade, and Chairman of the Board of Directors of Iranian Mines and Mining Industries Development and Renovation Khodadad Gharibpour, Iranian steel industry is an export-oriented one, such that the country exports more than 40% of its steel output.